This is especially true of pure software or internet companies that still have small or medium sized market caps. For example Unity, draft kings, lemonade, slack, square, etc... Can all gain 1 million+ new customers. With very little additional overhead cost to infrastructure.
Meanwhile companies like Costco requires millions of dollars and time to build additional warehouses to acquire new customers. Value stocks started underperforming growth stocks 10-15 years ago. Which coincided with when tech in the US really started taking off.
Anyways this is another reason why tech and ETFs like ARKK and QQQJ might continue to outperform. Because they pick small or medium sized (in terms of market cap) tech companies that are innovative. Yes the fast growth potential may be priced in, but when looking for possible 10x investments, it seems that the majority of the time it will continue to be tech companies for some time.
Submitted October 19, 2020 at 04:30PM by Okmanl https://ift.tt/2TaQexc
